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(Bloomberg) -- BHP Billiton Ltd. may begin first production from its Jansen potash project in Canada as soon as about 2023, according to people with knowledge of the plans.

The world’s biggest miner judges that the market could be in a position to absorb new supply by then, said the people, who spoke on condition of anonymity because the plans are private. BHP hasn’t given a specific start date for the project, which remains subject to board approval and dependent on market outlook, according to Chief Executive Officer Andrew Mackenzie.

The company is considering plans to develop the asset in Saskatchewan in stages, with a lower capital expenditure than earlier proposals, which would help avoid flooding the market with too much supply, the people said. The cost of the project would likely be multiples lower than the $16 billion estimated in 2013 by Citigroup Inc., they said.

Potash markets have reached their low point, according to Potash Corp., the second-largest producer, which said last month it sees the potential for record demand in 2017. India will be a positive driver for consumption over the next five years, according to U.S. fertilizer producer Mosaic Co. It’s forecasting strong potash demand growth next year and plans to restart an idled mine in Saskatchewan from January.

BHP declined to comment on the timing of Jansen’s development, saying it’s continuing to work through the feasibility study phase. “Development timing and cost remains subject to the outcomes of these studies and board approval,” the producer said in an e-mailed statement. “We believe in the long-term fundamentals of the potash market and that the world will require greenfield potash supply after 2020.”

BHP’s initial proposals for a larger Jansen operation were uneconomic, Macquarie Group Ltd. analysts said in a note dated Aug. 18. The bank last year said its base-case scenario assumed the indefinite deferral of the project. Potash prices have collapsed since 2013 and Russian billionaire Andrey Melnichenko, who controls fertilizer maker EuroChem Group AG, forecasts it may take a decade for the market to work off excess supply.

Demand for potash, a crop nutrient that improves drought resistance and strengthens roots, is forecast to rise as higher output is needed from limited agricultural land, according to K+S AG, Europe’s biggest producer. As the world’s population grows, diets are including increasing amounts of protein, the company said in a presentation this month. Global demand for fertilizers will rise 25 percent in the decade to 2018, according to the Food and Agriculture Organization of the United Nations.

Phased Development

BHP, which has reshaped its portfolio around key iron ore, copper, oil and coal assets, sees potash as a potential additional opportunity to tap rising consumption and an expanding middle class across Asia. “When we look forward in the plans for this company, say 10, 20 years, then there is one scenario where quite a bit of the EBITDA is going to be coming from potash,” Mackenzie said last week on an earnings call with analysts.

A $2.6 billion project to complete production and service shafts at Jansen is about 60 percent complete, BHP said in an Aug. 16 statement. The work will be concluded in 2018 or 2019, following which the producer’s board will need to decide on the asset’s future.

BHP will consider options including a phased development and could also weigh a mothballing of the asset if the market outlook is unfavorable at the time, Mackenzie said on the earnings call. The producer is continuing to talk to potential partners over taking a stake in the project and efforts to lower development and operating costs will make Jansen more attractive, he said.